[dexen]

>Yet living standards aren't improving >There's a housing bubble in virtually every major city of Europe

The former stems from the later, and from the lags inherent to markets.

Wage adjustments lag behind employment numbers. Right now while the employment numbers are increasing, there is still quite a bit of 'slack' (unemployed and underemployed people) that can be, and indeed is getting, picked up. Thus we still don't have significant wage increases.

Living standard change lag behind wages changes. Once the wages start significantly increasing, people will go ahead and spend on that one or three things they always wanted to, but couldn't previously afford. And the list is way longer than just the usual consumer goods: investment, savings, healthcare, vacations&leisure, shopping around for better job. Housing market is a great example: there's major imbalance between supply and demand, and it will take a few decades to significantly improve[1], due to both changing populations and building out. The prices will go up even higher before the correction comes.

[1] it will significantly improve in a few decades, barring some heavy-handed governmental interventions.